Study: 4 factors of the $933.5B US healthcare spending boom

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Between 1996 and 2013, healthcare spending in the U.S. increased $933.5 billion, from roughly $1.2 trillion to $2.1 trillion, according to a study published in JAMA.

The researchers — led by Joseph Dieleman, PhD, an assistant professor at the Institute for Health Metrics and Evaluation at Seattle-based University of Washington — analyzed 155 separate health conditions across six treatment categories, including inpatient care, outpatient care, emergency services, dental care, prescription services and nursing care to examine trends in U.S. healthcare spending.   

In addition, the researchers evaluated the changes in five factors: population aging, population growth, disease prevalence, service utilization, and service price and intensity of service, to quantify changes in healthcare spending.

Here are four reasons healthcare spending starkly increased between 1996 and 2013.

1. The growing price tag on medical services. Price increases and the intensity of medical services accounted for more than 50 percent of the spending increase —leading to $583.5 billion of the $933.5 increase.

2. An aging population. Researchers found that the aging American population contributed to 11.6 percent of the increase, accounting for $135.7 billion of the spending.

3. The sheer population increase. The study concluded that the nation's population growth increased healthcare spending by 23.1 percent.

4. Emergency department care, retail pharmaceutical spending. Across all health conditions, the greatest annualized growth rates were in ED care (6.4 percent) and retail drug spending (5.6 percent). 

It remains important to note that declining disease prevalence caused reductions in healthcare spending and service utilization did not have a statistically significant change on spending.

To read the full report click here.

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